What unique feature about perpetual options makes it possible to derive a valuation formula?
What will be an ideal response?
The time to expiration is constant: infinity. Given that time to expiration is constant, the price for early exercise is also a constant.
You might also like to view...
Alexander City Consultants started business on January 1, 2016, and immediately purchased $1,000 of supplies to use in the business. At the end of the month, 25 percent of the supplies remains unpaid and 20% are still on hand. What amounts should appear on the financial statements for January, 2016? Income Statement Statement of Cash Flows
a. ($ 1,000) ($ 1,000) b. ($ 1,000) ($ 750) c. ($ 800) ($ 25) d. ($ 800) ($ 750)
Which of the following is direction in the motivation process?
A. what a person does B. how hard a person works C. how long a person works D. how smart a person works
The interest on a $1,500, 15%, 120-day note payable or receivable is:
a. $7.50 b. $75 c. $1,575 d. $225 e. none of the above.
Which of the following is true of the "order to pay" requirement of a negotiable instrument?
A) It is an instruction to pay and must be more than an authorization or request. B) It must identify with reasonable certainty the person to be paid. C) The addition of words of courtesy, such as "please pay," will not destroy the negotiability. D) All of these.